Stella Smith tells the Third Sector Finance Forum that unrealistic expectations could lead to cut corners and a loss of public confidence

Stella Smith

Charities should use existing resources and volunteers more wisely rather than focus on further financial growth, according to the consultant Stella Smith.

Speaking at the Third Sector Finance Forum this morning, Smith said financial growth was needed for stability and paying bills, but unrealistic expectations could lead to corners being cut in departments such as fundraising and eventually lead to a loss in public confidence in the charity.

Instead, charities should show keenness to exploit existing resources, such as their volunteers, to achieve their goals, Smith said.

"Nowadays I see some perhaps brilliant people who have retired and are so full of great ideas and energy, and I think ‘why are we having them stuffing envelopes?’" she said. "‘Why are they not contributing their skills and expertise in a different way?’

"Finance is an enabler. Finance will help us along the way."

Smith said charities had to make sure their staff had the skills they needed to flourish outside the charity if the organisation achieved its purposes for its beneficiaries.

"I think there is a real danger that they are afraid of change and are more concerned about preserving their jobs, because they get nervous about what is going on outside," Smith said.

"I think change is about strengthening our staff’s skills and confidence so that, if one day their services are no longer needed, they are confident enough to get jobs elsewhere.

"They are not dependent on the charity. They are there to deliver a service to the beneficiaries and then, when that time comes, they will be all right to go."

Smith also warned that larger organisations might have "frankly not very good services" but still be incredibly rich, whereas smaller organisations could be very effective at the services they ran. Financial growth, she said, was not a goal in and of itself.

Mergers, Smith added, could be "hard work", and collaboration should instead be the goal for charities, even if that collaboration was with organisations outside the charity sector.

Anna Brennand, chief executive of the Ironbridge Gorge Museum Trust, told the forum that finance was "an enabler for the rest of the organisation" and "some trustees sometimes get hooked up on the business because that is their comfort zone".

She said charities should make it clear that the resources they raised helped them to deliver their cause and help beneficiaries.

Mergers could work if there was mutual benefit, but were not right for every charity, Brennand said.